Disney’s New Sports-Centric Joint Venture Draws Congressional Scrutiny
When Disney, Fox, and Warner Bros. Discovery announced that they were teaming up to create a sports-centric streaming service, questions were instantly raised about whether or not the joint venture would constitute a monopoly.
While some rivals like Paramount and Charter dismissed the new streaming service as folly, FuboTv Inc. (Fubo) quickly filed an anti-trust lawsuit against the three companies, alleging that they had “consistently engaged in anti-competitive practices.”
In their filing, Fubo noted that Disney, Fox, and Warner Bros. Discovery controlled more than half of the U.S. sports rights market and bluntly stated that by joining forces, other distributors would be unable to compete.
Iger Has Defended the JV
Although Disney CEO Bob Iger has since stated that he believed the joint venture would pass anti-trust scrutiny, whether or not regulators agree remains to be seen.
“We think it’s actually a sports fan’s delight in terms of being able to watch all those sports in one place. Very pro-consumer,” Iger said earlier this year.
Congress Has Questions
While the Fubo lawsuit plays out, the new joint venture has drawn congressional scrutiny. In a letter sent to the CEOs of Disney, Fox, and Warner Bros., today Rep Jerrold Nadler (D.-NY) and Rep. Joaquin Castro (D.-Texas) requested answers about the potential anti-competitive nature of the sports streaming joint venture.
“As programmers, your companies exert tremendous influence over pricing across the live sports TV ecosystem,” Nadler and Castro wrote in the letter.
The new joint venture, they continued, “raises questions about how this new offering would affect access, competition and choice in the sports streaming market. Without more complete information about the pricing, intent, and organization of this new venture, we are concerned that this consolidation will result in higher prices for consumers and less fair licensing terms for upstream sports leagues and downstream video distributors.”
The representatives requested answers to their 19 questions by April 30.
The Justice Department Will Also Examine the Venture
In addition to the Fubo lawsuit and the congressional inquiry, according to Bloomberg, the Justice Department is also looking into the joint venture.
Amid the scrutiny, Disney, Fox, and Warner Bros. have announced that they expect to debut the new steamer in the fall of 2024. The joint venture expects to have 5 million viewers in its first five years.
Thanks for visiting MickeyBlog.com! Want to go to Disney? For a FREE quote on your next Disney vacation, please fill out the form below and one of the agents from MickeyTravels, a Diamond level Authorized Disney Vacation Planner, will be in touch soon! Also, thanks for reading!